The freedom of flexibility is why a dynamic pricing strategy is the solution you have been waiting for to elevate your company to the next level
Dynamic Pricing Strategy
Businesses are now more adaptive and essentially intuitive when it comes to revenue management and this is thanks to having well-manicured strategy systems in place. Supply and demand is a continuously fluctuating process. Adapting to non-fixed pricing is key to keeping your business successful and high customer satisfaction.
What is dynamic pricing?
Simply put, dynamic pricing is selling the same products and services to consumers at different prices based on the current market demand. Unlike static pricing which stays generically constant daily, dynamic pricing varies depending on the day. This then increases across multiple price points according to e-commerce platform capabilities.
Dynamic Pricing Example
A great example of dynamic pricing is the hospitality industry. It is no secret that many influencing factors across the hospitality and services board reflect the constant need for price flexibility. Think about Booking.com or Airbnb where rooms and service availability are affected by the time of the year, the supply and demand, or the season. Then the extras the host provides all add up.
When someone wants to book a room for rent while on vacation factors such as location or season change the pricing, this can then be further refined to the price per night the person is willing to pay or the addition of breakfast. However, allowing booking customization or ‘dynamic pricing’ results in a higher booking and confirmation rate.
If this sounds like a strategy you have been searching for that will transform the way you manage your business moving forward and ultimately optimize profit margins, then Boardfy’s dynamic pricing tool is the solution you have been waiting for. It will help your marketing team ensure that the most accurate pricing strategies are implemented across your various marketing and sales channels.
And what’s even better is that if you don’t necessarily want automatic pricing updates as of yet, its adaptability to forecast results were you to create automatic price changes can be seen from the indicative data collected. It’s a win-win.
How does dynamic pricing work?
If long-term money making is part of your business plan then dynamic pricing is the way to go. The tool keeps an eye on your competitor’s activity as well as the market pricing fluctuations, and then it makes adjustments to your prices so you stay competitive but more so profitable.
Dynamic pricing tool
The game-changer for the future of business success and staying one step ahead of the crowd. This data-analyzing tool is the solution to your stress. Working with a revenue management platform that specializes in making your company its best version, helps bring your dream of a successful firm to reality.
Advantages of dynamic pricing
While the list of positives is long, this curated list of benefits is sure to help in your decision-making process to use a dynamic pricing strategy for your company’s foreseeable future;
- Profit increase
- Flexibility
- Competitive adjustments
- Increased sales
- Tailor various situations
Disadvantages of dynamic pricing
With that being said, it is not to say that it is completely flawless and fail-proof (yet), but if you are aware of the flip side of the coin you’ll be less reactive and more responsive when a spanner is thrown in the works.
- Competitive price wars – because you didn’t think your competition would take your success lying down did you
- Lack of trust from customers – feeling like they aren’t sure where your firm stands can leave them confused, frustrated, and in many cases uncertain of the brand
- Prices for customers seem unreliable and complex
Dynamic pricing for e-commerce
The online marketplace is unsurprisingly saturated with products and services so making money and increasing sales and revenue takes work. Therefore pricing needs to be as pin-pointedly optimal for your customers so they can get the best products at the best deals and you can still make money. A dynamic pricing strategy can make this happen so everyone comes out a winner.
Dynamic pricing big data
Thriving in these big, competitive online markets means being well-positioned and leveraging your data analytics to be as optimally sound as possible. This creates a customer-centric outlook but also creates a powerful pricing tactic for the firm.
Dynamic pricing Amazon
As one of the biggest brand names across the globe, Amazon is the perfect role model for successful dynamic pricing strategy techniques and effectiveness. Prices are forever changing and adapting to market price competitors including supply and demand. Price points often fluctuate which means they not only keep up with market trends but customers know they are getting the best deals at that current moment.
All factors considered
Providing a service and value to your customers should not deter you from adjusting your prices to ensure you are still within a profitable range. And when you have a pricing tool that automatically calculates and does the leg work for you, all the better.